Department of Employment and Labour & entities Quarterly performance, with the Minister

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Employment and Labour

21 August 2019
Chairperson: Ms M Dunjwa (ANC)
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Meeting Summary

The Committee was briefed by six entities of the Department of Employment and Labour: The Compensation Fund (CF), the Supported Employment Enterprises (SEE), the Commission for Conciliation, Mediation and Arbitration (CCMA), the Unemployment Insurance Fund (UIF), Productivity South Africa (Prod SA) and the National Economic Development and Labour Council (Nedlac) on their third Quarter performance reports.

In the Department of Employment and Labour the overall performance achievement on strategic objectives for 2017/18 was 71% and in Q3 2018/19 there was an improvement to 82%. This Q3 performance was presented according to programmes which included Administration, Inspections and Enforcement Services (IES), Public Employment Services and Labour Policy and Industrial Relations. In Administration there was R425 812.57 fruitless and wasteful expenditure, R0 unauthorised and R670 380.73 of irregular expenditure was detected and reported.

Members noted that over 60% of the youth needed and wanted jobs but the Department who sets its own targets was failing. Members were concerned that the Department with R670 380.73 of irregular expenditure did not tell the Committee if it has taken any action to alleviate this problem. The exercise to register job seekers for work at their institutions of study was lauded by the Committee. The Committee said it would love to see maybe in the next term the Department showing its break down of the short, medium and long term measures they had to address the challenge of unemployment because these small programmes they had were actually not addressing this crisis.

Members asked if there were recommendations that the Department actually conveyed to them and has the Department ever done the follow ups; it was noticeable that now in the Hospitality Sector it was hard to find South Africans; if there could be any regulation to consider and actually prioritise South Africans; how decentralised the registration process was regarding registering job seekers for internships; for the indicators to be elaborated upon; what plan the Department had in place to try and address the challenge of unemployment; and what measures can the Department put in place to ensure that it reached out to the rural communities.

Supported Employment Enterprises reported that there were 94 people with disabilities that were employed against the target of 75 people. 10% of the Q3 target on the annual increase of sales revenue from goods and services by the end of March 2022 has not been achieved by 8.36%, because of insufficient revenue generated. Members asked how people with disabilities were being targeted, and how were they getting informed about the opportunities that were available; and how the project was socialised so that there could be community mobilisation to support the project. Members were informed that part of failure to achieve targets had something to do with the organisation’s inability to reach the targeted markets. The Committee was asked to assist in this regard.

Members heard that at the CCMA all complaints were investigated and responded to, and that with a target of 98% of actual performance, 88.65% of all registered cases were heard within 30 days. 41% of jobs were saved compared to employees facing retrenchments (cases referred to CCMA). 45 180 cases were referred to the CCMA during the period under review, compared to 56 517 cases during the same period in the 2017/18 financial year. 16 564 people were capacitated to better understand the law and their rights through outreach activities conducted.

Productivity South Africa’s Q3 overall achievement performance per strategic objective indicators was at 50%. Members heard that a breakdown of the achievements during Q3 showed that Productivity SA achieved 48 companies ranged from small to large corporates in industry sectors including in the Special Economic Zones (SEZ). Members were pleased to hear that the entity’s capacity to generate additional revenue has improved with R3 million generated in the third Quarter.

The National Economic Development and Labour Council (Nedlac) reported an 86% overall achievement in performance per programme. Members heard that the organisation obtained a qualified audit opinion which was as a result of undisclosed irregular expenditure amounting to R391 809.00. Members asked if disciplinary action was taken against officials whose behaviour had resulted in irregular expenditure; how Nedlac was confident regarding the outreach of communities and was it using 11 languages in communication; and what were the contributory factors to Nedlac only being able to achieve 50% with regard to building constituency capacity. Members were informed that Nedlac has not been strong in terms of marketing the work of Nedlac but it was putting together plan to deal with this matter. Members advised Nedlac to ensure that all sectors were represented because for businesses to grow entities had to be monitored.

Members heard that the UIF had moderate overall achievements per Quarter with Q1 being 63%, Q2 was 63% and Q3 was 69%. 49% was underspent and the reason for underspending included compensation of employees, computer services and management fees. Members asked about noncompliance on the website that was always offline; payments for Paternity leave; why there was no Xhosa version of the pamphlets that had explanations on how to proceed; and how the Department would ensure that people from rural areas could reach out to these entities. Members were pleased to hear that there was a ‘Taking Services to the People’ campaign which was actually meant for people who were in rural areas. This allowed them to get access to much needed services.

Meeting report

Introductory remarks

The Portfolio Committee on Employment and Labour was briefed by the Department of Employment and Labour and its entities on the Third Quarterly Performance (QPR3) 2018/19. Entities included the Compensation Fund (CF), Supported Employment Enterprises (SEE), the Commission for Conciliation, Mediation and Arbitration (CCMA), the Unemployment Insurance Fund (UIF), Productivity South Africa (Prod SA) and the National Economic Development and Labour Council (Nedlac). The Minister Thulas Nxesi was present.

The Chairperson said that in the Sixth term the Ministry and the Department has an extended mandate which is Employment and that happened during the time where the country is facing the challenge of jobs particular with reference to the young and disabled people who are unemployed.

Briefing on the Department of Employment and Labour Report

The Director-General (DG) of the Department of Employment and Labour, Mr Thobile Lamati introduced the delegates that were present in the meeting. He briefed the Committee on the Quarter 3 Impact Analysis Report on the Annual Performance Plan (APP) 2018/19 of the Department of Employment and Labour.

He provided the comparative analysis of the overall performance between Q3 2017/18 and Q3 2018/19. The overall performance achievement on strategic objectives for 2017/18 was 71% and in Q3 2018/19 there was improvement to 82%. This Q3 performance was presented according to programmes which included Administration, Inspections and Enforcement Services (IES), Public Employment Services and Labour Policy and Industrial Relations.

 

In Administration there was R425 812.57 fruitless and wasteful expenditure, R670 380.73 of irregular expenditure was detected and reported. Mr Lamati said the reason for this fruitless and wasteful expenditure is caused by the hotel bookings made by the Department and the colleagues did not show up. Another reason is that the Department had to pay third party liability when there is a car involved in an accident which had to be fixed.  All the communication activities were achieved.

The Department targeted 43 746 inspections and there were 46 508 inspections conducted which makes 106%. He said the reason for the overachievement on inspections is that the public came to the Department and asked for inspections and the Department was unable to refuse.

446 Director General Reviews were targeted and there were only 114 that were conducted which make 88.6%. Only 118 of those were complied with and 256 failed to comply who were therefore issued with Director General Recommendations with which to comply with within 60 days.

In terms of Public Employment Services the Department targeted a total of 151 000 work seekers and the total work seekers that were registered is 203 296. 60% of registered work seekers are young people aged 16- 35 years and 40% are adults and above. Also 0.7% of work seekers have different disabilities.

However the consultative forums were not properly constituted as required by Section 16 with 17 of the Employment Equity Act which then resulted in non-compliance. Also there were no communication strategies in place to inform the employees of the EE Act.

Mr Lamati also briefed the Committee on the expenditure per programme. He said that as at 31 December 2018, the Department has defrayed expenditure to the value of R2, 235 billion against its adjusted budget of R3, 283 billion. Therefore this represents an expenditure level of 68% against a time expiration of 75%.

The Department also presented a comparative of labour organisation applications for Q1, Q2 and Q3 2018/19.

 

Discussion

Mr M Bagraim (DA) said there was over 60% youth who wanted jobs but one should look beyond the Department who sets its own targets and was failing on top of it which is very strange. He also said he knows that the main area of concentration for the DG should be creating an environment for job creation and that was completely missing in everything the Department has told us. For instance if one spent one day at the CCMA and listened to the arbitrations that were taking place you would find 1000 referrals per day, a thousand companies that issued payslips but did not pay even pay UIF etcetera.

Mr Bagraim said he is pleased to see that the Department had R0 unauthorised expenditure and he presumed that the AG report would then be clear for that period.

The Department also referred to R670 380.73 irregular expenditure, but it did not tell the Committee if it has taken any action, who has been suspended, and who has been brought to disciplinary enquiries. ‘It is pitiful to hear that you also have three newsletters, what are you people doing, should you not be sending newsletters daily or more’.

Mr Bagraim asked why journalists were getting paid because they were hungry for these news items.

Mr X Ngwezi (IFP) said in the report the Department found some institutions to be non-compliant and he believes that the ones mentioned here where the majority of people and he said that his understanding would be that there are some recommendations that the Department put specifically to those particular ones.

He asked if there are recommendations that the Department actually conveyed to them and has the Department ever done the follow ups. ‘Is there any change or improvements after trying the remedial steps’?

Mr Ngwezi asked if it was noticeable that now in the Hospitality Sector it was hard to find South Africans and he believes that is the basic job really that anyone can do and yet we cried about unemployment. He said that even in the Private Security Industries it was hard to find the kind of people that he mentioned. He asked if there could be any regulation to consider and actually prioritise South Africans because this is a basic thing that anybody can do.

The number of people who are registered as job seekers for internships was about 2 446 and he asked how decentralised this registration process was. He asked further if it would not be proper if the Department targeted these people as job seekers while they were still in TVET Colleges or in Universities, because the majority of them were in these institutions. It would be easy if the system was there where they were trained and it could have access to them.

Mr Ngwezi also said that this exercise by the Department does work. He had some people who had actually been registered and now they were in the Internship programmes. He asked how decentralised this process was because not everyone has access to this.

Ms H Jodaarn (FF+) referred to performance per strategic objective where the Department mentioned that it had 20 indicators according to measured performance in these different fields. She asked if the Department could please elaborate on those indicators like what these indicators were, how they were determined and in which way were they obtained.

Ms N Nkabane (ANC) said that the analysis is clear and concrete and she welcomes it. She asked what is the plan that the Department had in place to try and address this challenge of unemployment.

She said that the initiative of the programme is very clear but she wanted to know what measures can the Department put in place to ensure that it reach out to the rural communities because she does not think that the youth or unemployed people at Umzimkhulu in Harry Gala, Kwazulu-Natal are aware of this initiative.

The oversight committee needed to make sure that it reached out to communities in particular to rural communities to ensure they are aware of these initiatives through which the Department was trying to address the current crisis that the country was facing.

Ms Nkabane said that she would love to see maybe in the next term the Department showing the Committee its break down of the short, medium and long term measures that they had to address the challenge of unemployment because these small programmes are actually not addressing this crisis.

The Minister of the Department of Employment and Labour, Mr Thulas Nxesi replied on the issue of the Hospitality industry that it has been noticed that it was mostly foreigners and even in Agriculture a lot of farmers preferred foreign nationals. This has become a big embarrassment to the Department.

This also applied to the security industries and raised serious questions about the security of the country. He had been alerted to the fact that even in the retail sector some of the big retail companies or shops preferred employing foreigners.

Ms Nkabane said that the reason for this was the exploitation of cheap labour with desperate people, who are not even given a chance to work on the till as they had to stand for the whole day. She said that the Honourable Members should at some stage sponsor a debate in Parliament about this particular matter. So that the Department could be seen to be taking the correct approach so as not to get a backlash from our own African countries.

Mr Nxesi said there is also a question of wanting to increase this market in terms of the SADC trade protocols and so on.  He asked how the Department dealt with the matter of free trade. He asked which country would prioritise other nationals over its own nationals when it came to jobs, but at the same time how could it be done in such a way that it was balanced and not seen to be Xenophobic. This matter needed a debate before there are some explosions.

Mr Lamati replied that the targets that were set were based on the resources that the Department had. The Department always tried its best to ensure that it set targets that were resource based.

He said that the only reason that the Department was not able to achieve 100% of its target is that there was a requirement that came about during the course of the year that compelled it to publish collective agreements in a period of 30 days before the Minister could consider extending those agreements to non-parties. The Department had to comply with that, and that affected the performance of labour market policy and industrial relations.

He agreed with Mr Bagraim that the Department’s responsibility     was to create an environment for job creation. He strongly believed that that was what the Department is doing.

Mr Lamati responded that the Department always stressed the point that compliance with the law is not the responsibility of the Department but the responsibility of the employer.

Mr Lamati replied that there is a lot that is done through communication in the Department, so those three newsletters are enough to convey messages. He also agreed with Mr Bagraim that journalists are hungry for news, but the Department does not have the type of news that they are hungry for. The type of news that the Department had was mostly positive news, and in most instances they wanted controversy.

The Department had to write media statements and paid for those media statements so it did get media coverage/ journalists when there were events like the Budget Vote or other high profile events.

On dealing with non-compliance he replied that the Department does issue recommendations to companies that are not complying. There were also companies who came back to the Department to confess that they did wrong and corrected the issue.

He responded that the  employment services system is decentralised in the sense that all 126 labour centres have access to the system but the Department does not only end there, it also had Taking Services to the People where it targets the rural areas. The Department also gets support from other government departments, banks and other sectors.

On performance per strategic objective, government develops medium term strategic frameworks and from those frameworks there will be priorities in each Department. The Department of Employment and Labour for 2018 contributed to inclusive economic growth and job creation, so these indicators are informed by that government strategic framework.

On short, medium and long term plans to address the challenge of unemployment Mr Lamati quoted the Minister on the Budget vote and said “it is not the responsibility of employment and labour and certainly government to create jobs. It is the responsibility of private sector to create jobs, the responsibility of government and the Department of Employment and Labour is to create that environment conducive to the regulation of the labour market”.

The Department will have to liberate the resources that it has to ensure it contributed to job creation. What the department did in the short term was to have a Temporary Employer Relief Scheme and this was done by the CCMA and also with the assistance of Productivity SA, so the process now seemed less encumbered and there were complaints. He said that all of that has enabled the Department to protect jobs that it otherwise would have lost.

The Chairperson said that on the issue of measures to reach out for in rural areas, it would be appreciated if the Department can come with a breakdown for each province.

Mr M J Cardo (DA) asked what role the Department had and what initiatives was it committed to by the time of the job summit.

He asked further if the Department could provide the nature of the legal deductions on salaries of employees.

Mr S W Mdabe (ANC) asked whether there is a system whereby the internal audit unit would regularise depending on the content and nature of the irregular expenditure that incurred.

Mr M Nontsele (ANC) on the performance of the Northern Cape and Mpumalanga asked what steps or interventions were undertaken. He also asked if there were plans in terms of the expanded mandate of the Department.

He replied on the issue of foreign nationals and said that the point is fully supported and it should be sponsored for a debate in National Assembly.

Ms AS Zuma (ANC) asked if the Department had workshops for domestic workers, because some of domestic workers are abused by their employers.

Mr Lamati replied on the Department’s role at the job summit, and said that the Department through Nedlac was responsible for organising the job summit and working together with social partners, business labour and the community.

On the job summit, there are 77 interventions that formed part of the agreement and those interventions will result in 237 000 direct jobs. He also said that the Department can provide the report on the commitments during summit, which included the temporary employer relief scheme and so on.

On the Basic Conditions of Employment Mr Lamati said that it was clear and if one was going to deduct money for accommodation or electricity and all that, the building had to meet certain conditions such as there had to be electricity, no broken windows, and running water and so on. If those conditions are met that deduction became an illegal deduction.

For employers who are deducting money there is a maximum percentage that can be deducted from the employee’s salary. Because of the need to have money employees would take loans from their employers and this was mostly happening in farming sector and during the fortnight when they got paid the employers took their money in full regardless of the regulations. That was another kind of illegal deductions.

Mr Lamati said that the Department has the internal audit and the Risk Unit which provided the Department with reports and this was why it was able to detect these irregular expenditures.

On the performance of the Northern Cape, it was the combination of things which resulted in the Head of the province being disciplined and suspended for 3 months with no payment. He believes that the situation had improved so the Department has taken steps to address the situation

The Department can provide a report in terms of what it was doing in preparing for the extended mandate.

Mr Lamati said that it is difficult to do inspections in the domestic worker sector because during the day the employers are not available in the households. The Departments was doing its best to service the sector through taking services to the people so that domestic workers can come and talk to the Department so that it can resolve their issues.

Ms Aggy Moiloa, Deputy Director General on Inspections and Enforcement, responded that in terms of BCEA no deductions are allowed for more than 25% of the monthly earnings of an individual. She said in some instances there are deductions that were up to 70% or 80% but those are the illegal deductions.

On initiatives for domestic workers the Department has held workshops and also reached out to radio stations with communities. It also hosted advocacy campaigns with the last one being in Jabulani.

The Chairperson agreed with Mr Nontsele and Mr Nxesi on the issue of the debate and she said it was very urgent that the Committee was able to give direction because it is a matter that could create challenges in government.

Briefing on the Supported Employment Enterprises (SEE) Report

Mr Sam Morotoba, Deputy Director General of Supported Employment Enterprises briefed the committee on the Q3 Performance Report. On the background of the SEE, it has been presented that the SEE provides employment to a total of 159 staff seconded to support operations, and a total of 1100 people with disabilities employed under the Basic Conditions of Employment Act.

The overall performance per strategic objective indicators achieved during QPR3 is 50%. He also reported that there were 94 people with disabilities that were employed against the target of 75 people.

10% of the Q3 target on the annual increase of sales revenue from goods and services by the end of March 2022 has not been achieved by 8.36%, because insufficient revenue was generated.

Mr Morotoba said the SEE will focus on remedial actions during Q4 to improve its performance.

Discussions

Ms Jordaan asked how people with disabilities are being targeted, and how are they getting informed about these opportunities.

Chairperson asked the entity to bring linens that are made by the entity when they are coming for Q4 to show the committee their products.

Mr Nontsele asked how the project is socialised so that there could be community mobilisation to support the project.

Mr Nontsele said that part of failure to achieve targets had something to do with its inability to reach the targeted markets and asked if Committee could assist.

He also said that it should be checked what the position of the project was in relation to the new extended mandate of the Department so that when the Committee talks about it, it can be seen in a broader sense.

Mr Morothoba responded that the marketing department will do that during the budget vote and in the process of taking the service to people.

The Department normally targets those schools that had learners that had learning difficulties because the Department knows that those kids have very good skills when it comes to work and others are referred by mental institutions.

Briefing on the Commission for Conciliation, Mediation and Arbitration (CCMA) Report

Mr Cameron Morajane, Director: Commissioner for Commission for Conciliation, Mediation and Arbitration said that against eight targets of Q3 performance strategic objective there was an achievement of five targets which then constituted a 63% overall performance achievement on strategic objectives.

The CCMA had managed to achieve five capacity building interventions against six interventions on effective negotiation skills covering the COGP (Codes of Good Practice) and the accord with strategically identified users. The reason for non-achievement was due to downtime experienced due to early closure during December.

Mr Morajane said that on the issue of non-achievement a proactive action was implemented in the 2018/19 Q2 wherein an additional five interventions were delivered.

A target of 98% of all registered cases were heard as the first event within 30 days (excludes the agreed upon extension). The Q3 actual performance is 88.65% of all registered cases heard within 30 days against that target of 98%. The reason being was that the description of the target was not prescriptive enough to produce accurate statistics. This resulted in non-achievement. The CCMA said this target has been amended in the 2019/20 APP and will now be achieved as planned.

41% of jobs were saved compared to employees facing retrenchments (cases referred to CCMA). 45 180 cases were referred to the CCMA during the period under review, compared to 56 517 cases during the same period in the 2017/18 financial year.

16 564 people were capacitated to better understand the law and their rights through outreach activities conducted. CCMA received 88 complaints during this period, compared to 99 complaints received during this period in the 2017/18 financial year. All complaints were investigated and responded to.

Discussions

There were no discussions made.

Briefing of Productivity South Africa (Prod SA)

Mr Mothunye Mothiba, Chief Executive Officer of Productivity South Africa briefed the Committee on the mandate of Production South Africa, which was to promote employment growth and productivity to contribute to South Africa’s socio-economic development and competitiveness.

The Q3 overall achievement performance per strategic objectives indicators was 50%. Mr Mothiba made a comparative analysis per programme and for Q1 the overall achievement was 37%. For Q2 the overall achievement was 37% and for Q3 2018/19 50%.

A breakdown of the achievements during Q3 showed that Prod SA achieved 48 companies ranged from small to large corporates in industry sectors including in the Special Economic Zones (SEZ), and the Industrial Parks were supported through the WPC (Workplace Challenge Programme) programme against the target of 25.

117 Education, Training and Skills Development Facilitators (ETSDs) productivity champions and beneficiaries trained against the target of 40. Mr Mothiba also said the entity capacity to generate additional revenue has improved with R3 million generated in the third Quarter.

Mr Mothiba also said that there was a target of 1024 small and medium enterprises on Enterprise and Supplier Development (ESD) programmes supported through productivity and operational efficiency enhancement programmes that were not achieved against 1600 targets.

He told the committee that one Senior Productivity Advisor position is to be filled during the next Quarter and one resource to return from Maternity Leave as the remedial action on non-achievement.

Discussions

There were no discussions made.

Briefing on Nedlac (National Economic Development and Labour Council)

Mr Teboho Thejane, Unemployment Insurance Fund Commissioner, presented the overall performance per programme. The overall performance per programme in Q3 showed an 86% overall achievement. The challenges faced by Nedlac included the performance appraisals that were not conducted as some of the employees had gone on maternity prior to the conclusion of the appraisals.

Challenges faced by Nedlac in terms of the Annual Performance Plan  included obtaining a qualified audit opinion which was as a result of undisclosed irregular expenditure amounting to R391 809.00 on the financial statements. He said that no performance improvement plans were developed due to employees who had undergone performance appraisals.

In terms of irregular and expenditure in Q3 Nedlac had not identified additional irregular expenditure, however an opening balance of R1 093 631 existed and an amount of R391 809 was included during the year related to activities in the 2017/18 financial year.

Wasteful expenditure was R5 936 due to no-shows relating to travelling arrangements and investigations relating to these amounts are continuing.

Mr Thejane also showed the implementation of the audit action plan as at the end of Q3. He said as at the end of Q3 Nedlac had 121 audit action items, 79 out of 121 were completed, 25 out of 121 were in progress, and 15 out of 121 were not completed.

15 items that were not completed are items related to policies and notes to the interim financial statements and annual financial statements. 2 out of 121 items were not started which are related to disclosed notes which would only be addressed by compilation of interim financial statements and final financial statements.

Organisational priorities for 2019/20 included enhancing risk management systems and compliance, increases necessitating additional funding and effective implementation of the audit plan, to enhance communication and outreach, the provision of a social dialogue platform to engage on legislation, monitoring and evaluation of the job summit agreements as well as an overall framework of Nedlac, and to continue with the section 77 Notices in line with the Nedlac protocol and code of practice.

Discussion

Mr Cardo asked if disciplinary action was taken against officials whose behaviour had resulted in irregular expenditure. If there were he asked Nedlac to give the Committee a private report on that.

The Chairperson asked how Nedlac was confident on the outreach of communities and was it using 11 languages in communication.

The Chairperson asked about building constituency capacity and what were the contributory factors to Nedlac only being able to achieve 50%.

Mr Thejane replied that indeed Nedlac received a negative audit outcome and because of that there was an investigation that was put in place in Nedlac and there were recommendations that had to be acted upon.

The recommendations from the MANCO (Management Committee) and the EXCO (Executive Committee) were implemented and this was why there was a suspension of the senior management from Nedlac. Disciplinary procedures have taken place and the outcomes have been pronounced. Nedlac was now in at the CCMA level. That was why Nedlac still had an acting Executive Director and an acting CFO.

On communication Mr Thejane said that since Nedlac was an entity of the Department of Employment and Labour, the DOL (Department of Labour) had integrated the communication strategy that ensured that the work of Ministry and its entities was marketed and promoted, so Nedlac was using that strategy.

However Nedlac has not been strong in terms of marketing the work of Nedlac but it was putting together plan on that, and it is also highly reliant on the constituency to be able to assist the entity.

On constituency capacity building, Mr Thejane replied that the challenge was that there was supposed to be research conducted during that period and unfortunately because of timing that was not done, but the Committee will note that when the entity presents in Q4 it will see that 100% would have actually been achieved  in terms of that particular output.

Mr Mdabe asked if on small and medium businesses the constituency was specifically represented as one constituency with one multinational association or was there a structure whereby they would present their mandate in relation to sides of the business which they conducted.

Mr Thejane responded that Nedlac was made up of four constituencies which were Business, Labour and Government, so businesses were represented within that particular business constituency.

Chairperson asked how Nedlac ensured that all business sectors were being represented. She proposed that Nedlac should ensure that all sectors were represented because for businesses to grow entities had to be monitored.

 

Briefing on the UIF (Unemployment Insurance Fund)

Mr Teboho Maruping, Commissioner of the Unemployment Insurance Fund presented a comparative analysis of the 2018/19 performance per Quarter. The overall achievements per Quarter were as follows Q1 was 63%, Q2 was 63% and Q3 was 69%, there were 16 planned indicators and the entity achieved 11 indicators for Q3.

On Administration for Quarter 3 performances, there was a target of 15% of administrative expenditure as compared to Revenue maintained and 14% of the targets were achieved. There was also a 100% target on valid invoices paid within 30 days after they were received by the fund, and that 100% target was achieved. Of the 60% target of the total mandated Social Responsible Investment (SRI) committed, 93% was achieved, the reason being that the SRI commitment value had increased by 18% in its current Quarter.

There were 90% Unemployment Insurance Funds benefits processed within 15 working days. On finalised benefits in provinces, Mr Maruping made a comparison with 3 quarters and they are as follows:  Q1 91%, Q2 94% and Q3 96%. In-service benefits processed were 90% within 10 working days, death benefits processed was 90% within 20 days and the overall figure of the finalised amount was 93% for Quarter 3. Benefits payments processed were 95% within 6 working days and 100% was achieved for finalised benefit payments for Q3.

On programme 1 51% of the budget was spent and 49% was underspent and the reason for underspending included compensation of employees, computer services and management fees. 98% of the budget was spent and 2% was under spent. Factors contributing to the underspending were compensation of employees and the SARS commission.

Discussion

Mr Bagraim asked about the noncompliance on the website that was always offline, he added that he even received calls from people complaining about the landline calls that were not answered in the UIF entity, and that the queues were still not managed.

He said that he thought UIF by this period would bring up payments of Paternity leave. There was no Xhosa version of the pamphlets that had explanations on how to proceed. He complimented the entity and the DG on the Edcon disaster which UIF managed to avoid.

Mr Maruping responded that the whole ICT infrastructure for the Department has been upgraded. The issue of phones happened when the Department was migrated to a new centre, but now that has been sorted out.

On queue management the Department had introduced queues technology across the labour centres which it learnt from the CCMA. Mr Maruping confirmed that technologically the Department was done with the process of payments of paternity leave. The process that it was now undergoing was getting regulations signed off by the Minister.

Chairperson asked how the Department would ensure that people from rural areas could reach out to these entities.

The DG replied that the ‘Taking Services to the People’ campaign was actually meant for people who were in rural areas. This allowed them to get access to these services.

On payments for Paternity leave, the DG said that if applications were submitted and the system was there, then the applications would be processed.

Briefing on the Compensation Fund (CF) Report

Mr Vuyo Mafata, Compensation Fund Commissioner, reported to the Committee on the Quarter 3 2018/19 Performance. He said that there was a total number of seven indicators that were targeted for Q3 and six indicators were achieved which constituted 86% of the overall performance on strategic objectives.

He then made a comparison between Q1, Q2 and Q3 on analysis per programme. All three quarters had the same percentage of 86 for performance. There were 90% of registered compensation claims adjusted within 40 working days. 85% of medical invoices were finalised within 60 working days, also 85% of pre-authorisations were responded to within 10 working days and 85% of compliant requests for assistive devices were responded to within 15 working days.

Discussion

Mr Bagraim said that the Compensation Fund is doing quite well, but many of the doctors do not really see the work of compensation because over 70% of them are not getting paid in Cape Town.

The Chairperson said that it always came to the matter that there is a need to have one piece of legislation for the three departments which are the DOL, the Department of Minerals and Energy and the Department of Health to deal with the matter of mine workers injuries and lung disease.  

Mr Nonstele asked what the policy gaps were that created these kinds of problems and what does the Committee need to do to ensure that the Funding Act effectively helps people who are in these situations.

Mr Lamati responded that the CCOD must clean up its house and deal with its liabilities then the Department can deal with the issue of integration.

Mr Mafata responded that the compensation fund has a campaign called ‘Last Call Project’, where it helps employees who have been injured in the workplace. Some of their claims have been registered and others not. People are encouraged to forward their claims.

One of the things that were done was ensuring that the entity was tied to the occupational side as a safety division of the Inspectorate to try and proactively work with employers so that the entity can try and deal with the issue of the non-reporting of incidents. This will also assist and push the message of preventing workplace injuries.

The Compensation Fund has actually been reaching out to the medical fraternity to work with them and see how best it can try and address a lot of their issues. A lot of people in the industry are seeing the change with the claims that are now being paid. The CF is developing a new system that will be going live from the 1st of October. This system will modernise how CF is working.

Mr Nxesi requested that Members should watch the area of the CF very carefully because it was about billions of Rands on behalf of the workers, and the issue of corruption has gone very deep.

The Chairperson said that the Committee will watch the space of Minister to ensure that the entity was improving. She also said to the DDG that the CCOD was cleaning its house.

The Chairperson concluded the meeting, she said that the presentations are empowering the Committee to have an understanding and questions are a process of ensuring that the Departments are able to see if there are any loopholes in any areas that they may have taken for granted.

She said that she has observed that there were only males that were doing the presentations and she said that she hoped that the Members and entities will look at that.  

The meeting was adjourned.

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